New Zealand enterprises face skills shortages and fragile supply chains. Learn how digital productivity, automation and AI can build resilience today while unlocking capacity for growth tomorrow
New Zealand enterprises are navigating a period of relentless disruption. Skills shortages, constrained migration and fragile supply chains have exposed the vulnerabilities of an island economy. Treasury analysis shows that labour productivity growth in NZ has averaged just 1.0% over recent decades, well below OECD leaders.
Too often, productivity is framed as cost-cutting. But in reality, it is the foundation for resilience and growth: helping organisations withstand disruptions today while creating the capacity to expand tomorrow.
Before exploring how digital productivity builds resilience and growth, it’s worth grounding the conversation in the facts. According to the New Zealand Productivity Commission, Treasury and NZIER, the data tells a clear story:
● 40% gap: Labour productivity (GDP per hour worked) is around 40% below the average of the top half of OECD countries.
● 60% behind other small economies: Compared to small advanced economies like Denmark, Ireland and Singapore, New Zealand’s gap is closer to 60%.
● 1.0% growth: Labour productivity growth has averaged just 1.0% per year since the mid-2000s, well below OECD leaders.
● Working harder, not smarter: New Zealanders work longer hours than many OECD peers, but produce less per hour.
● GDP per capita: Remains about 30% below the average of the top half of the OECD.
These figures underline why productivity must be reframed. The issue is not about squeezing more hours from already stretched staff - it’s about creating resilience and growth through smarter processes, automation and technology.
Global uncertainty has made resilience a board-level priority. For NZ enterprises, the pressures are acute:
● Workforce shortages: Border closures and ongoing migration shifts have tightened the talent pool. Even as migration settings ease, demographic change means competition for skilled workers will remain high.
● Supply chain fragility: As an island economy heavily reliant on imports, New Zealand is vulnerable to global shipping disruptions and supplier concentration risks.
● Rising service expectations: Customers expect faster, more seamless experiences - even as organisations face resource constraints.
In this environment, productivity is not just about trimming headcount - it’s about creating stability. By redesigning processes and embedding automation, enterprises can do more with the resources they have, reduce reliance on scarce labour and remain agile in the face of disruption.
True productivity gains are not just defensive. They unlock capacity that can be reinvested into growth, including:
● Freeing staff for higher-value work: Automating repetitive tasks reduces fatigue and opens bandwidth for innovation, customer care and strategy.
● Improving customer experience: Faster enrolments, quicker onboarding and real-time supply visibility enhance service and build trust.
● Creating space for innovation: Productivity frees the resources organisations need to experiment with new products, services and business models.
NZIER notes that New Zealand lags small advanced economies like Denmark and Ireland in productivity growth - economies that have used technology and innovation to leap ahead. For New Zealand enterprises, the opportunity is clear: productivity must be reframed as a driver of growth - with technology as the enabler.
In an environment of workforce shortages and global uncertainty, technology provides the leverage organisations need to stay resilient and create space for growth. When paired with lean processes, platforms like automation and AI move beyond efficiency tools to become strategic enablers - ensuring continuity in tough times while freeing capacity for innovation and expansion. Across New Zealand, practical examples are already emerging:
Automation removes bottlenecks and ensures continuity even when labour is scarce. Instead of relying on manual processes that slow operations and introduce risk, automation keeps critical workflows moving. Examples include:
● Automating routine approvals to cut delays and free managers for higher-value work.
● Streamlining claims processing to reduce manual error and speed up resolution.
● Digitising enrolments and onboarding so staff spend less time on paperwork and more time supporting students or employees.
● Using predictive maintenance to anticipate equipment failures, reduce downtime and extend the life of critical assets.
These practical applications demonstrate how automation can provide both resilience in the face of disruption and a stronger platform for future growth.
AI is not a replacement for human judgement - it is an accelerator of it. By surfacing real-time insights and triaging complex information, AI helps leaders and frontline teams make faster, more confident decisions when it matters most.
In practice, this means:
● Detecting anomalies in financial or operational data before they escalate into major risks.
● Prioritising service requests so customer-facing teams can resolve the most urgent issues first.
● Optimising workforce scheduling to balance demand with available staff, particularly valuable during labour shortages.
● Enhancing supply chain visibility by flagging potential disruptions early, allowing managers to pivot quickly.
Platforms such as UiPath now integrate AI directly into automation workflows, allowing insights to be actioned immediately. For example, an AI model might flag a suspicious transaction and an automation bot can then launch the investigation workflow without waiting for manual intervention. Similarly, pairing Microsoft Power Platform analytics with automation means frontline staff not only see the data but also trigger the right next step - seamlessly, within the same ecosystem.
Technology enablers must be both powerful and practical. For New Zealand enterprises, the priority is to deliver results without embarking on multimillion-dollar, multi-year legacy replacement programmes. These two platforms stand out for their ability to deliver impact quickly and scale over time:
● UiPath: an enterprise-grade automation platform designed to orchestrate high-volume, complex workflows across multiple systems. UiPath excels at removing manual effort from repetitive processes, integrating with existing applications, and embedding AI into automation. This makes it ideal for organisations with heavy compliance or transactional workloads, such as utilities managing subcontractors or financial services monitoring large volumes of transactions.
● Microsoft Power Platform: a suite of low-code tools (Power Apps, Power Automate, Power BI and Power Virtual Agents) that empower both IT and business teams to co-create digital solutions. With Power Platform, staff can quickly design apps, automate workflows and extract insights from data - without requiring deep technical expertise. This flexibility makes it well-suited for organisations needing to digitise processes like student enrolments, staff onboarding or retail scheduling.
By leveraging platforms such as these, New Zealand enterprises can move beyond isolated “random acts of automation” to build coherent, scalable programs that strengthen resilience and create capacity for growth.
Improving productivity is not a theoretical exercise - it requires deliberate, staged action. For New Zealand enterprises, the path forward must balance pragmatism with ambition: start where the pain is greatest, prove value quickly and then scale confidently. Here are four practical steps:
Automation layered on top of broken workflows only accelerates inefficiency. Before deploying new tools, organisations should map how work actually happens, identify bottlenecks and apply lean principles to remove duplication and waste.
Start with high-friction areas that drain resources or frustrate customers. Tackling these first delivers visible wins and builds momentum for broader change.
“Random acts of automation” may create pockets of efficiency but rarely add up to enterprise-level impact. Establishing clear governance, metrics and accountability ensures that productivity initiatives stay aligned with business strategy.
With processes redesigned, pilots proven, and governance in place, organisations can confidently scale. The goal is not a single “big bang” transformation, but a steady expansion of automation and digital productivity initiatives across functions and sectors.
By following these steps, New Zealand enterprises can move from isolated fixes to a sustainable program of digital productivity - one that builds resilience in the face of ongoing shocks and creates the capacity for long-term growth.
At a large university, the admissions team handled more than 15,000 student offers annually, but manual workflows led to bottlenecks, delays and frequent errors. By implementing an intelligent automation solution, the organisation streamlined the entire process - delivering the equivalent of eight full-time staff savings, reducing errors and providing faster, more accurate outcomes for students. Crucially, this also built resilience during the COVID-19 disruption, ensuring continuity of service at a time when demand and uncertainty were at their peak
This is productivity as resilience and growth in action - protecting continuity while unlocking capacity for better student and staff experiences and long-term competitiveness.
Resilience and growth are two sides of the same coin. For New Zealand enterprises, productivity is the lever that enables both - stabilising operations in times of disruption, while freeing the capacity to innovate, expand and compete globally.
At Ilaria, we see productivity not just as cost-cutting, but as the foundation for resilience and growth. By combining lean process design with automation and proven platforms, enterprises can weather today’s pressures and create the conditions for tomorrow’s opportunities.
For a deeper look at the scale of New Zealand’s productivity gap and why it matters for every sector, read our blog. https://ilaria.co/post/productivity-challenge-new-zealand
Digital productivity is the use of technology, automation and lean process design to help organisations get more value from the same resources. It goes beyond efficiency to create resilience, capacity for growth and better customer outcomes.
Automation reduces reliance on scarce labour by removing repetitive, manual tasks. This creates stability in operations - ensuring critical workflows continue even during workforce shortages or supply chain disruptions.
Productivity frees capacity that can be reinvested into innovation, customer experience, and expansion. Instead of focusing only on reducing costs, digital productivity helps enterprises improve resilience today while building the foundation for future growth.
Platforms like UiPath (for intelligent automation) and Microsoft Power Platform (for low-code apps, workflows and analytics) enable organisations to digitise processes quickly, integrate across systems and scale transformation without replacing legacy infrastructure.
